5 hedge funders and government insiders have been charged with illegal trading

Reuters NEW YORK — A Washington, DC, political consultant, a former federal employee, and three others have been charged with using confidential information from within a US health agency to engage in an insider trading scheme.

Federal prosecutors on Wednesday unsealed an indictment in Manhattan federal court against David Blaszczak, a political consultant and founder of Precipio Health Strategies; Christopher Worrall, a former Department of Health and Human Services employee; and Rob Olan and Ted Huber, listed as employees on the website of the healthcare hedge fund Deerfield Management.

Jordan Fogel, a former Deerfield employee who was also charged, pleaded guilty on Friday, according to a spokesman for Joon Kim, the acting US attorney in Manhattan.

Lawyers for the defendants could not immediately be reached for comment. Deerfield, which is not charged, also could not be reached.

Prosecutors said that from 2012 to 2014, Olan, Huber, and Fogel schemed to get confidential information from the Department of Health and Human Services from Blaszczak, who had worked there. Blaszczak, in turn, got the information from his former colleague and "close friend" Worrall.

Worrall worked in the agency's Centers for Medicare and Medicaid Services division, which oversees government health-insurance programs, according to the court papers. The confidential information included advance notice about regulations of radiation cancer treatment and dialysis, allowing Deerfield to trade in healthcare companies affected by the rules.

The Securities and Exchange Commission said on Wednesday that it had filed a separate complaint against Blaszczak, Worrall, Huber, and Fogel over the alleged scheme.